Evening capital. (Annapolis, Md.) 1884-1910, 1887-08-15
Building Association VS.. Savings
Bank.

source of great good to the poorer
classes, and as great source of
profit to the richer. Savings Banks
have also been a great blessing to
all classes, but especially to the
poorer. TO show the relation Of
these institutions to the prosperity
of community, it may be we'll to
demonstrate by an example.
A man of moderate means has
some ready money and desires to
buy himself a little home. lie sees
a piece of property that suits him,
but which can only be bought for
cash. The building association
Immediately suggests itself as "a
means to amend" He takes 10
shares of stock, the paid-up value
flor the sake of easy calculation) we
will say is $3.50 per share; and on
this he borrows 81, 800 for 10 years.
His dues per week on these ! 0 shares
are S2.50-his interest per week at
per cent. is $3.50, making the
round sum of $500 per week. The
total number Of weeks in 10 years
being 520-his total payments will
be in actual cash $20S0. Now, by
the system of equations, we find
that the average date of these pay
ments is about 5 years. Therefore
al an investment he would he enti-
tied to 8 years interest on this
amount at per cent. which would
amount to 1924, amounting in the
grand total to 81, 704, as the cost of
his property. The payments how
ever, have only been what his rent
would have amounted to; it has been
made in such small sums that lie
does No. feel it, and at the end of
Z 10 years he has no more rent to pay
Now let us take the same case as
regards Savings Bank. Instead
of borrowing the money from a
Building Association, he borrows
the same amount for years from
q Savings Bank at the same rate of
g per cent: his interest therefore will
be the same per annum ($7S). He
then begins to deposit his $3.50 per
week in the SavingsBank as sink
ing fund and reserves his $3.50 to
meet his interest payments semi
annually; or this too can be depos-
tied, aud draw interest to be check
ed against at maturity of interest
obligations. But as the intricacy
of calculation on these continual
deposits and drafts is great, we will
only consider the example from the
standpoint of the $3.50 weekly de-
posts. At the maturity of his
mortgage to the Savings Bank he
has on deposit 1866, (actual depos-
its) which by equations has drawn
interest of 4 per cent. for % years,
which therefore entities him to sos
more, making to his credit $715
and which he can pay on account
OF his mortgage, and leave balance
unpaid Of $685., which he continues
by way Of renewal. During this 3
years he HIS paid bis SIS interest
annually, which also would have
drawn at 6 per cent. by equation
- years interest amounting to $751;
so, which amount, in the general
summary, we will add to the cost
OF the property. Ills debt now re-
duced to $5S5-he continues to pay
his $3.50 weekly into his sinking
fund and in 1 years and ? months
by the addition Of his 4 per cent.
Savings Bank interest he has sufi-
Gent money in the Bank 10 settle
his mortgage. During this time he
is paying $500 per annum for the
loan, which aggregates $146s %;
which being worth at 6 per cent.
b equation, 2 years interest $3.50
makes an aggregate Of s16S.S0 to-
Be added to the cost Of the property.
Nov for the comparison.
The absolute cost II 10 years through
Building Association Is. 81 90
The same IN years and ? months SAY